I agree. Bug. Or deplorable oversight, if you prefer.
Also, KO is not the only mod I use of yours, Tejon. But I like it a lot. TRAP is great for Argonians, especially with OOO. Makes playing a stealthy archer light armor type viable. The "hide" power (whatever it's actually called) is indispensible at low levels against, say, gargoyles. And having soul trap as a power is wonderful, especially since I'm also using Enhanced Economy to make myself really freaking poor.
So, I suppose my own tips on playing OOO (I actually use FCOM) mainly revolve around using additional mods to tailor the game further to your chosen playing style.
gothemasticator
P.S. I had to trade Progress + nGCD for Oblivion XP, finally. My available playtime is so scant nowadays that I needed a way to make advancement progress faster and more tangible in shorter playing sessions. I realize I could change the settings on P & nGCD, but it didn't feel right any more. In my opinion, those two together are great for tailoring advancement speed to really epic long playing sessions. You really get a sense of accomplishment after four hours of near-death experiences, and you're looking lovingly at those scant few incremental advancements. With XP, I can play for half an hour and count the points I'm racking up.
gtm